Guest Viewpoint: Court ruling on fracking could end divisive debate

May 7, 2013

Written by

Kenneth S. Kamlet

On May 2, an intermediate Court of Appeals in Albany issued twin decisions upholding the legal authority under New York law of the towns of Dryden and Middlefield to ban gas drilling within their borders. Reactions vary from cheers to jeers.

As a lawyer, I won’t dwell on these different views, but I would like to focus on the legal and policy implications of the decision. First, what did the decision not say? Second, what legal options are left to those New Yorkers who would still like to lease their land for gas drilling? And, third, what policy opportunities does the decision open up for Gov. Andrew Cuomo?

• What the decision did not say. The decision turned on the court’s holding that “the powers delegated to local governments … to regulate the use of land through ... zoning laws” are not preempted by state laws that regulate “the details and procedures” of oil and gas drilling, even if the former “have an incidental effect” on the latter.

But, this doesn’t expand the reach of traditional zoning. Town A may be able to validly ban the use of the land within its boundaries for construction of well pads and drilling of wells, but it cannot prevent Town B from allowing well-drilling on adjacent land within Town B’s borders. And it probably cannot prevent horizontal drilling thousands of feet beneath the surface to tap gas deposits under Town A — as long as the affected landowners consent and the terms of state drilling permits are adhered to.

And, while the decision speaks to the rights of municipalities opposed to gas drilling, it doesn’t address the coequal rights of municipalities that welcome drilling.

• Options left to pro-drilling landowners. Assuming New York’s highest court (the Court of Appeals) does not accept review of the Dryden and Middlefield decisions or, even if it does but upholds the intermediate court, landowners still have options.

As was decided last October by Broome County Supreme Court in the Jeffrey v. Ryan case, gas drilling moratoria such as the City of Binghamton’s must satisfy certain essential prerequisites laid down in case law, including a “dire necessity” justification that does not exist as long as no state gas drilling permits are being issued.

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In addition, under well-established precedents, both moratoria and bans must adhere to state laws of general applicability, such as the General Municipal Law requirement that they be referred to county planning departments for review — and if the result is a disapproval recommendation, the referring entity only may pass the moratorium or ban by a super-majority vote (e.g., four affirmative votes in a five-person city council or town board).

Landowners may also subject proposed local laws seeking to restrict gas drilling to super-majority approval requirements by collecting signatures on “protest petitions” pursuant to Town Law 265.

And, in certain circumstances, landowners may have additional options, in the form of “takings” lawsuits against municipalities that seek to thwart their “reasonable investment-backed expectations” to beneficially use their oil and gas mineral rights.

• Policy options for Cuomo. Had the Appellate Division overturned the Dryden and Middlefield decisions, the governor would have faced a dilemma because then he would have been all that was standing in the way of the widespread commencement of high-volume fracking in New York.

By upholding the lower court gas drilling bans, the Appellate Division has given Cuomo a middle-ground approach that will anger fewer antifrackers and displease fewer pro-drilling landowners than under the other scenario: He can cite the decision as the definitive word (absent contrary action by the Court of Appeals) that the ultimate choice on gas drilling in New York is up to local governments and not the governor, and that a locality that doesn't want gas drilling (and has followed the rules in banning it) will not have to accept it (while those that want it, can have it).

The decision issued on May 2 will elicit varying reactions, but I hope the governor will use it as a basis for prompt and decisive action to allow the “new New York” to move forward and end a divisive debate that has diverted our energies (no pun intended).

Kamlet is an attorney with the Binghamton law firm of Hinman, Howard & Kattell. His legal blog on Marcellus Shale gas drilling (”Shale Gas Perspectives”) can be found on the firm’s website at www.hhk.com.